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MSE News: Maths PhD student can't comprehend complicated bank charges
Former_MSE_Helen
Posts: 2,382 Forumite
This is the discussion thread for the following MSE News Story:
"Consumers using unauthorised overdrafts find it virtually impossible to calculate how much their bank would charge them ..."
"Consumers using unauthorised overdrafts find it virtually impossible to calculate how much their bank would charge them ..."
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Comments
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Perhaps the Maths PhD student is another example of lower academic standards these days.
Personally I prefer the approach of don't go overdrawn or it'll cost you. Life is much simpler that way.
Or the complex formula of:
Unauthorised overdraft = get stung0 -
Consumers were asked to work out the cost of an unauthorised overdraft for four different banks using a mock bank statement. Despite one of the volunteers being a maths PhD student, not one got all the calculations right.
OK, how many calculations were correct and what was the magnitude of individual errors? Was it charges or interest that proved problematical?
Who decided what was correct?
Were all the banks's calculations "correct"?
Can we all try?0 -
I don't know that being brilliant at Maths necessarily means you are good at arithmetic!0
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There was one PhD student out of how many? What was incentive for the student?
Where is the original research? What kind of study was it?0 -
Ph D in Mathematics? Did anyone check this `fact`?
h0 -
This story contains the usual amount of corroborating evidence of an MSE news story - none.
Why would you post this without giving even the most basic of details?0 -
This story seems to have been copied from Which?, but is still interesting...
I am not sure what is meant by getting all the calculations "right". I suspect that the bank statements were taken from real customers, and the exercise was to predict what charges would be applied. Since the people who write software for banks are not exactly mathematicians, the actual charges often differ from what an accurate calculation suggests they should be. In this kind of case, the 'volunteer' may actually have got it right while the bank gets it wrong, but virtually no-one working for a bank really understands the formulae they use and so can understand the way that charges are calculated.0 -
Ever since the banks switched to daily interest calculation (which was favoured by the vast majority of consumers) working anything out exactly has become impossible. But you can get things pretty close. Example, my loan balance went down less than usual this month. Eventually I worked out the 1st of January was a sunday, and the 2nd was a bank holiday. Sure enough the bank took the payment two days late and the extra interest looks about right for an extra 2 days. I expect this to come right on the 1st Feb because I'll have to pay 2 days less interest (it would only have accrued from the 4th to the 31st).
To expect someone, even a Phd, to be handed my loans terms and conditions and work it out exactly is unrealistic.
With overdrafts it is worse. You can be charged interest on different amounts on a daily basis so you'd need to work it out daily based on the closing balance. Once you have the daily interest rate and balances right its just simple maths.
XXbigman's guide to a happy life.
Eat properly
Sleep properly
Save some money0 -
It's a very silly and lazy headline for a fleetingly interesting story. The way it is written indicates that there is a specific person with a PhD in Maths who has been questioned and who could not come up with the answer. A doctorate in maths is not a doctorate in arithmetic or even common sense. It's not indicative of educational standard either, but of attainment. But of course not as interesting a headline as 'Someone who can do sums couldn't fathom bank charges'. But then we live in an educational state where 'Professors' abound in spurious subjects in spurious higher education establishments, where media 'experts' turn out for a fiver and where young people are encouraged to get useless degrees and - er - run up debt.
"When I use a word," Humpty Dumpty said, in rather a scornful tone, "it means just what I choose it to mean—neither more nor less." Hence rubbish headlines.0 -
Yup another Daily Mail headline. Even undergraduate level maths is so abstract that it would probably make you worse at doing this. However, I would expect someone with a PhD in Law, Accounting or Computing to get the answers perfectly. After all, it's lawyers, accountants and programmers who write the terms and conditions, work out what makes the bank the most money, and then set up the computers to calculate these charges!0
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